For a lot of people, contemplating the decision to take up a life insurance policy can be a little intimidating, if not downright scary. For one, it seems complicated, with all the different options out there and all the horror stories we hear about companies not paying up, fraud, and various other nightmare scenarios. Secondly, thinking about our own mortality and planning ahead for it is something a great many of us wish to avoid as much as possible. It’s a natural reaction.
What we have to remember when it comes to life insurance is that it’s one of the best ways to ensure that our mortality doesn’t cause more distress than it needs to. It’s a way of keeping loved ones cared for and safe even from beyond the mortal plane. That said, it might be of use to have a quick look at the process of acquiring life insurance, in order to make it a bit less taboo.
1. Assess your needs
The first thing you have to consider when trying to figure out your life insurance path is; what would it take to keep your loved ones in stable financial condition for a reasonable amount of time should anything happen to you? Remember that your paycheck won’t be coming through without you. What are their expenses? School, rent, clothing, food, etc…everything must be considered. Ideally, your policy should be able to keep your family going for the number of years in which they would have relied on your income.
2. Compare your options
The insurance market is flooded with providers, and the unfortunate part of it is that not all of them can be relied upon to honor your policy should it become necessary. What you should do is look around for quotes from at least three reputable, established insurance firms. These are firms that are financially secure enough to be relied upon to honor their commitment to you and your loved ones.
3. Make your choice
With your insurance company options on hand, what you need to do is settle on one and make your application. Determining this should not only depend on the company’s track record and reputation, but also on the sort of premiums they are proposing to charge you. High-value policies come with high-cost premiums and you need to be careful to ensure that you are in a position to maintain timely premium payments lest you default and put your policy at risk.
4. Undergo your medical checkup
Usually, depending on your age, policy type, and other factors, you will be asked to undergo a medical examination to determine your health status. This gives the insurance company a better idea of how much risk you represent as a policyholder. Young, healthy holders will generally pay less in premiums than older, less healthy people.
5. The approval procedure
The approval process, once you get to it, is relatively simple. It will only involve the signing of the policy document, which is basically a legally binding contract between you and the insurance company. Once you sign up, you are officially covered.
6. Coverage review
You should periodically go over your insurance policy to make sure it is able to cover your needs as you and your family grow and develop. Once a year is a suitable frequency to make sure your coverage keeps up with your standard of living requirements.
7. Policy period ending
Depending on the terms of your policy, your policy period might come to an end after a certain number of years or once you reach a certain age and once this happens, you might get a payout that will usually equal or be slightly larger in value than the cumulative premiums you have paid into the company over your policy period.
All in all, life insurance is something everyone, especially those with dependents, should seriously consider for their own peace of mind and the ensured provision for their loved ones should the very worst come to happen.
